Employees can contribute as little as Dh100 on a monthly basis to the National Bonds pension scheme. Antonie Robertson / The National
Employees can contribute as little as Dh100 on a monthly basis to the National Bonds pension scheme. Antonie Robertson / The National
Employees can contribute as little as Dh100 on a monthly basis to the National Bonds pension scheme. Antonie Robertson / The National
Employees can contribute as little as Dh100 on a monthly basis to the National Bonds pension scheme. Antonie Robertson / The National

National Bonds unveils 'Golden Pension' plan for foreign workers


Deepthi Nair
  • English
  • Arabic

National Bonds, the Sharia-compliant savings and investment company owned by the Investment Corporation of Dubai, unveiled a Golden Pension Scheme to help private-sector foreign employees with their financial planning.

The scheme will give employees working for registered companies a head start in retirement planning through returns offered by National Bonds, the company said on Tuesday.

“When it comes to pensions in the UAE, it’s either offered by asset management companies to sophisticated investors or in the form of insurance saving products, where you have to invest for a long time and the redemption process is tedious, with the investor being heavily penalised for early redemption,” said Mohammed Al Ali, chief executive of National Bonds.

“This scheme is targeted at employees who are looking for simplicity and low-risk investment.”

The Covid-19 pandemic put employee financial issues in the spotlight, with many companies now trying to formulate plans to help workers bridge their savings gap.

About 45 per cent of UAE residents have not yet started saving for their golden years, a survey in April by insurance company Friends Provident International found. About 44 per cent of people in the Emirates expect to retire by 55, while 63 per cent hope to before they turn 60, said the FPI survey, which polled 1,000 people.

In March, Sheikh Hamdan bin Mohammed, Crown Prince of Dubai, launched a savings retirement scheme for non-Emirati employees working in the emirate’s government and public sector.

The system is in addition to the existing gratuity scheme. End-of-service gratuities are lump-sum payments to which all employed residents are entitled after completing at least one year of service. Gratuity payments are covered by the UAE labour law and the sum depends on an employee’s length of service and basic salary.

Foreign employees working in Dubai’s public sector will be enrolled in the savings scheme by default and the employer will contribute the total end-of-service gratuity to the plan from the date of joining, without including the financial dues for previous years of service.

The Dubai International Financial Centre was the first body in the UAE to overhaul the gratuity system when it introduced the DIFC Employee Workplace Savings (Dews) plan in February 2020. The scheme allows participants to choose a plan in line with the type of investment risk they are willing to take.

Under the National Bonds pension scheme, the employer has the choice to either invest the entire end-of-service benefits accumulated over the years as a lump sum or invest a portion.

Employees have the flexibility to contribute as little as Dh100 ($27.22) a month. They can watch their pension savings grow in real time from their individual accounts on the National Bonds’ app, the company said.

A company in Dubai with 9,000 employees has already subscribed to the pension scheme, National Bonds said.

"They decided to open 9,000 individual customer accounts for their employees and proportionately invested their accumulated end-of-service benefits with us across these accounts," Mr Al Ali said.

"We will invest in money markets [deposits with banks], sukuks and our income-generating real estate portfolio."

The plan also aims to support companies with employee retention efforts, as well as help them plan for end-of-service financials, National Bonds said.

"We encouraged employers to invest their end-of-service amounts. Unfortunately, a lot of end-of-service dues are not funded by employers," Mr Al Ali said.

"Employees miss an opportunity to grow their end-of-service benefits because it is not being invested."

Seventy-eight per cent of companies in the Middle East do not fund end-of-service gratuities. Instead, they pay it out of company cash when the benefits fall due, according to the 2020 Middle East End-of-Service Benefit Willis Towers Watson Survey, which covered more than 300 organisations.

Employees can withdraw from a National Bonds' pension scheme when their employer allows them. However, they can withdraw from their individual contributions at any time, Mr Al Ali said.

Tearful appearance

Chancellor Rachel Reeves set markets on edge as she appeared visibly distraught in parliament on Wednesday. 

Legislative setbacks for the government have blown a new hole in the budgetary calculations at a time when the deficit is stubbornly large and the economy is struggling to grow. 

She appeared with Keir Starmer on Thursday and the pair embraced, but he had failed to give her his backing as she cried a day earlier.

A spokesman said her upset demeanour was due to a personal matter.

Gothia Cup 2025

4,872 matches 

1,942 teams

116 pitches

76 nations

26 UAE teams

15 Lebanese teams

2 Kuwaiti teams

Dubai works towards better air quality by 2021

Dubai is on a mission to record good air quality for 90 per cent of the year – up from 86 per cent annually today – by 2021.

The municipality plans to have seven mobile air-monitoring stations by 2020 to capture more accurate data in hourly and daily trends of pollution.

These will be on the Palm Jumeirah, Al Qusais, Muhaisnah, Rashidiyah, Al Wasl, Al Quoz and Dubai Investment Park.

“It will allow real-time responding for emergency cases,” said Khaldoon Al Daraji, first environment safety officer at the municipality.

“We’re in a good position except for the cases that are out of our hands, such as sandstorms.

“Sandstorms are our main concern because the UAE is just a receiver.

“The hotspots are Iran, Saudi Arabia and southern Iraq, but we’re working hard with the region to reduce the cycle of sandstorm generation.”

Mr Al Daraji said monitoring as it stood covered 47 per cent of Dubai.

There are 12 fixed stations in the emirate, but Dubai also receives information from monitors belonging to other entities.

“There are 25 stations in total,” Mr Al Daraji said.

“We added new technology and equipment used for the first time for the detection of heavy metals.

“A hundred parameters can be detected but we want to expand it to make sure that the data captured can allow a baseline study in some areas to ensure they are well positioned.”

List of alleged parties

 May 15 2020: PM and Carrie attend 'work meeting' with at
least 17 staff members

May 20 2020: PM and Carrie attend 'bring your own booze'
party

Nov 27 2020: PM gives speech at leaving do for his staff

Dec 10 2020: Staff party held by then-education secretary
Gavin Williamson

Dec 13 2020: PM and Carrie throw a flat party

Dec 14 2020: London mayor candidate Shaun Bailey holds staff party at Conservative
Party headquarters

Dec 15 2020: PM takes part in a staff quiz

Dec 18 2020: Downing Street Christmas party

UAE currency: the story behind the money in your pockets
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UAE currency: the story behind the money in your pockets
Updated: October 11, 2022, 2:29 PM`